Rising Global Food Prices Threaten Moroccan Households
In Morocco, the prospect of rising global food prices looms large, potentially subjecting the purchasing power of Moroccan families to new pressures in 2027. This situation arises from an anticipated wave of increases in global food prices, exacerbated by ongoing geopolitical tensions and disruptions in international supply chains. Despite forecasts suggesting a relative decline in energy prices over the coming year, the Moroccan economy is poised to face a new test in managing imported inflation and its implications for both the cost of living and production expenses.
The World Bank's latest report on the outlook for commodity markets, published in October 2026, reveals expectations of a 10% increase in global food prices this year, followed by an additional 7% rise in 2027. This cumulative increase of approximately 17.7% over two years is likely to escalate pressures on Morocco's food import bill, particularly for products that the national market relies on from abroad to meet part of its needs.
Furthermore, the report highlights that the commodity markets are currently facing a dual challenge of supply disruptions in energy and food sectors, largely due to the ongoing conflicts in the Middle East and the Black Sea region, in addition to the climatic impacts of the El Niño phenomenon. These factors threaten agricultural production in various parts of the world, increasing the likelihood of price volatility spilling over into importing markets, including Morocco.
These predictions come at a time when the Moroccan economy is becoming increasingly sensitive to changes in international markets. As of the end of September, the country's energy bill reached 111.59 billion dirhams, reflecting a 37% increase, alongside a widening trade deficit of 323.94 billion dirhams, underscoring the potential pressures that a continued rise in import costs could exert on external balances.
Although the national grain harvest has rebounded to approximately 90 million quintals, the sustained increase in global prices for grains, oils, and essential food products may dampen the anticipated gains from improved agricultural production. This is particularly pertinent given the connection between the costs of certain local products and the prices of fuel, transportation, fertilizers, and imported inputs, which means that the repercussions of global inflation are not limited to imported goods in their final form.
Impacts of Geopolitical Tensions and Climate Phenomena
The World Bank paints a concerning picture of food price developments over the current and upcoming years. Disruptions in grain and oil exports through the Black Sea have contributed to a 14% rise in global grain prices between June and September, coinciding with growing concerns regarding the impact of extraordinary climatic conditions on global agricultural production.
The report anticipates that grain prices will continue to rise in 2027 by nearly 9%, primarily driven by deteriorating agricultural conditions affecting global wheat production and rice in Asia, alongside the ongoing disruptions to exports from Russia and Ukraine, which together account for about 30% of global wheat exports.
This data is particularly significant for Morocco, given the national market's reliance on imports of soft wheat, corn, and several staple food products. Increases in international prices are likely to lead to heightened costs for supply, milling, and feed production, which will ultimately be passed on to consumers in the form of higher prices for end products.
The warnings extend beyond grains; the World Bank forecasts an 8% increase in prices for oils and products derived from oilseeds in 2027, driven by rising demand for animal feed and biofuels, as well as climatic disruptions threatening palm oil production in several Asian countries. The report indicates that projections for palm oil prices next year have undergone a 15% upward revision compared to estimates from April, while forecasts for rice prices have been raised by 21% and sugar by 12%, due to concerns about declining harvests in drought- and flood-affected regions.
These developments are poised to intensify potential pressures on food production costs in Morocco, particularly for businesses that rely on oils, sugar, grains, and imported production inputs. Some industrial units may struggle to absorb rising costs without adjusting selling prices or reducing profit margins.
The World Bank warns that the El Niño phenomenon during the 2026-2027 period could be one of the strongest recorded since comparative measurements began in 1950, raising the likelihood of severe climatic disturbances affecting the production of rice, vegetable oils, soybeans, coffee, and cocoa, although the abundance of global stocks for some crops may mitigate the severity of the shock.
Simultaneously, the report emphasizes the persistent fragility of global energy markets, despite expectations of a decline in the average price of Brent crude oil from $91 in 2026 to $79 in 2027, based on assumptions of improved oil supply and no significant escalation in geopolitical conflicts. It is projected that energy prices will rise by 32% this year, followed by a 12% decrease next year.
The implications of these forecasts are critical for Morocco, as it is a net energy importer. Continued increases in international fuel prices could impact the costs of land and maritime transport, as well as industrial and agricultural production, further compounding financial burdens on businesses, particularly small and medium-sized enterprises, and increasing the likelihood that some of these costs will be transferred to the final consumer.
The report noted that the prices of refined petroleum products, especially diesel and jet fuel, have risen at a pace exceeding the increase in crude oil prices during 2026, due to damage to refining facilities and the disruptions to petroleum derivative exports from the Middle East and Russia, indicating that a drop in crude prices does not guarantee a similar reduction in fuel costs.
In the case of natural gas, the World Bank predicts an average price increase in European markets of 58% this year, reaching around $19 per million British thermal units, followed by a limited decrease of no more than 8% in 2027, settling at $17.5, a level that remains high compared to previous estimates, with potential repercussions on energy and imported industrial material costs.
Moreover, the report anticipates a 14% rise in global fertilizer prices in 2026, before returning next year to levels similar to those observed in 2025, assuming a decline in energy costs and improved supplies of raw materials used in their production, particularly ammonia and sulfur, which may relatively alleviate pressures on agricultural production costs.
The World Bank does not rule out a more pessimistic scenario for 2027, marked by simultaneous disruptions in oil supplies, deteriorating climatic conditions, and interruptions to grain exports, which could push global prices to levels significantly above baseline expectations. Should conflicts escalate in the Middle East and attacks on Russian oil facilities continue, global oil production may decline to around 100 million barrels per day in the first half of the coming year, potentially raising the average Brent price to $105 per barrel, reflecting an increase of nearly 33% compared to the 2027 baseline scenario.
In the food markets, within the negative scenario, the World Bank forecasts that concurrent climatic and geopolitical shocks could lead to food prices rising by about 12% above the expected levels in the baseline scenario, while grain prices could exceed those expectations by 20%, threatening to reinvigorate a strong wave of global inflationary pressures.
For Morocco, the realization of this scenario could result in an additional increase in the food and energy import bill, exacerbating pressures on the trade balance and limiting the ability of businesses to manage production costs, particularly in sectors heavily reliant on imported raw materials. These risks emerge at a time when Bank Al-Maghrib's forecasts suggest inflation could be contained at 1.5% in 2027, a level that remains contingent on the evolution of food and fuel prices, along with internal factors related to agricultural production and national demand.
However, the transfer of rising global prices to the Moroccan market does not necessarily occur at the same rates; it is influenced by multiple factors, including the exchange rate of the dirham, shipping and distribution costs, stock levels, support mechanisms, and the ability of producers and importers to absorb part of the increases without passing them on entirely to consumers. The World Bank emphasizes that the risks surrounding its forecasts lean more towards rising prices than falling ones, due to the likelihood of multiple shocks occurring simultaneously in energy and food markets. It also notes that achieving lasting resolutions to conflicts or a slowdown in global economic growth could drive prices to levels below expected forecasts.
As reported by hespress.com.
